In arid Chile, villagers and farmers divided over merits of new water fund

By far the most significant and strategic contribution Barrick has made to the Huasco Valley has been to help improve the irrigation infrastructure through the Pro-Water Fund — $60 million over the life of the mine (about $3 million each year) mostly to improve the system of canals.

So far the fund, in which the Chilean government and Barrick pay roughly equal parts, has lined 2.5 kilometres of canals with concrete to prevent seepage underground.

Luis Gustavo Diaz, the manager of the fund, said the irrigation network, previously little more than a series of scars in the earth, used to lose 60 per cent of the water to evaporation and seepage.

Now the system loses one to two per cent to evaporation — as well as to theft by neighbours, who do not own water shares themselves. (Water in Chile is privatized.)

A more reliable water supply has allowed farmers who do have shares to increase their cultivation of grapes and avocados — the main crops here. Agricultural land in the Huasco Valley has increased by 15 per cent during the past six years, Diaz said, while the regions of Copiapó and Coquimbo, to the north and south respectively, are constantly losing ground to the encroaching desert.

In April, the Chilean government declared a state of emergency in the Copiapó valley — much as the Argentinian government did in San Juan province — because the riverbed has practically run dry.

In the Huasco Valley, Barrick is an important ally, Diaz said. But others see the water fund as a poorly disguised way for Barrick to buy support — or at least quash dissent.

The 2,000-strong irrigation users’ network — to which all those with water shares belong — was vehemently against the Pascua-Lama mine, and used its weight and influence in the community to denounce the project. That is until 2005, when it negotiated the water fund with Barrick.

Meanwhile, the essence of the project, and the perceived risk it poses to the valley because of its demand on scarce water resources and proximity to glaciers, which provide most of the water in this arid region, remains unchanged.

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In arid Chile, villagers and farmers divided over merits of new water fund

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